Thailand Blows Hot and Cold on Tourism

Thailand wants to provide insurance coverage for foreign travellers visiting the Kingdom in a bid to strengthen the destination’s appeal. At the same time, the government decided to increase the fee for travellers on a visa-on-arrival scheme.

Thailand is more than conscious that tourism is the bread and butter of  the Kingdom’s economy. Tourism represents 10% of the country’s GDP, generating US$ 3.7 billion in revenues.

The recent bombing attacks in the South and Hua Hin could slowdown the growth, also the government so far estimates that the impact will be limited. However, this is the character of the motivation behind the recent attacks which could generate new worries.

For the current government, the fact that the bombings were not linked to local opposition -as earlier claimed- but to the Muslim insurgency in the Deep South could eventually destabilize tourism. It is indeed the first time that the ongoing conflict in Malay-speaking areas of Southern Thailand against the Central government is spreading to areas outside the three provinces of Narathiwat, Pattani and Yala.

To send a strong signal to foreign travellers, the Finance Ministry and the Tourism and Sports Ministry are considering now offering travel insurance to foreign tourists. According to the Bangkok Post, The budget to fund the travel insurance scheme may come from the Thailand Tourism Promotion Fund or the Foreign Ministry’s budget for immigration checks, and the central budget may be used to support any shortfall, declared to local newspapers Fiscal Policy Office Director-General Krisada Chinavicharana.

The Fiscal Policy Office (FPO) has also floated the idea of a new tax break for domestic tourists in the form of deductions of domestic travel expenses from taxable income, director-general said. The cabinet already approved last April  the renewal of stimulus measures for the tourism industry that include a 15,000-baht tax break on domestic tour packages and hotel accommodation for individual taxpayers, as well as for businesses and private individuals organizing training programs.

Meanwhile, the government just approved a new measure which could have some negative effects on travellers. According to the Bangkok Post, foreign visitors from 19 countries and territories will be required to fetch a THB 2,000 (US$56.60) fee for visas on arrival, twice as much as the current rate of THB 1,000. The new requirement will come to effect on Sept 27 according to the website of the Ministry of Foreign Affairs. Among the 19 countries required to get a visa on arrival are EU countries such as Andorra, Bulgaria, Cyprus, Latvia, Lithuania, Malta and Romania but also important markets such as China, India and Taiwan.

However, visa fees at embassies will stay same. The government justifies the fee hike by the fact that it will reduce long queues at immigration checkpoints. However, it could also act as a potential deterrent for last minute travel. Foreigners from the 19 countries and territories are allowed to stay in Thailand for up to 15 days with a visa-on-arrival.